Foxlink reportedly wins China Mobile, China Unicom's cellphone orders

Cheng Uei Precision Industry Co., Ltd. (Foxlink) reportedly is expected to supply medium/high-level assembled cellphone sets and components to major mobile telecom carriers in mainland China including China Mobile and China Unicom, according to industry sources.

The sources said that Foxlink chairman T.C. Guo held a meeting with some Taiwanese parts suppliers in Beijing and Foxlink is scheduled to begin shipments of China Mobile- and China Unicom-branded cellphones in spring of 2008. With the new businesses, Foxlink's profits are expected to grow by at least 30% next year.

Foxlink spokesman Liu De-bin, however, commented that he "does not know anything" about the report.

Industry sources pointed out that China Mobile would soon finalize its bid project for third-generation (3G) TD-SCDMA (time division - synchronized code division multiple access) handsets and kick off a even-bigger procurement project for global system for mobile communications (GSM) multimedia handsets, which will be sold under China Mobile's own-brand in the future.

Industry sources said China Mobile has had talks with Foxlink and decided to let Foxlink supply a certain part of about 30 million China Mobile-branded handsets and some of the components as well.

As foreign cellphone brands have been winning increasingly high market shares in China, according to industry insiders, Chinese central government has been trying to develop homegrown cellphone sales-channel business. So, the Chinese central government planned to tie up with two major mobile telecom companies, China Mobile and China Unicom, commission China-based TechFaith Wireless Inc. to develop cellphone models, and let Foxlink to be responsible for handling the supplies of key-parts such as molds/dies, connecting wires, batteries, antenna, LED screens, etc.

The sources added that Foxlink has established good and comprehensive personal links in China while the firm's cellphone plant in Suzhou of Jiangsu Province owns strong R&D capability and big-volume manufacturing capacity. They also said that Chinese central government's choice implies Foxlink's strong technical and production capabilities as well the firm's unmatched components integration efficiency.

Foxlink registered revenue of NT$4.7 billion (US$145.51 million at US$1: NT$32.3) in October, hitting a record monthly high. Some institutional investors estimated that the company would enjoy revenue and profits growths of 21% and 38%, respectively, in 2008 thanks to strong growth momentum behind cellphone, GPS, MP3 player, printed circuit board (PCB) connectors.

source & copyright: CENS